Shawn R. Merriman has pleaded guilty to mail fraud in a Ponzi scheme case that swindled dozens of investors in Colorado,Â Minnesota and Utah. The scheme involved more than $20 million, prosecutors said.

Merriman, 46, of Aurora, Colo., faces up to 20 years in prison and a fine of up to $250,000. The SEC said he used some of the money to buy valuable art, including works by Rembrandt.

“Merriman repeatedly deceived investors, many of whom considered him a personal friend, by sending them fictitious account statements showing annual rates of return of 7 to 20 percent,” the SEC said.

But Merriman “did not trade stocks and options after his first year of operations,” the SEC said.

Regardless, “he used millions of dollars in investor funds to support his lavish lifestyle and pay out withdrawals by other investors. He also offered ‘rebates’ to existing investors to entice them to invest additional money with him.”

Merriman also bought “classic cars, motorcycles, motor homes, a cabin in Idaho and fine art collections, including works by Rembrandt that are worth millions of dollars,” the SEC said.